This misconception goes further. The range of possibilities for what can be an NFT coincides surprisingly well with works eligible for copyright. While every jurisdiction defines “works” in different ways, none stray too far from the essentials. In Canada, for example, copyright protection extends to literary, artistic, dramatic or musical works in addition to performances, recordings and other related works. Creators need not apply for these protections — the state provides them inherently upon the creation of the work.
Naturally, this protection is guaranteed for the original work that an NFT represents. When artwork is created and auctioned on an NFT marketplace, the copyright functions almost exactly as it would in an in-person scenario, with the copyright retained by the artist. But a lack of copyright trading infrastructure that complies with international law makes the exchange of NFT copyrights impossible on current platforms.
So, unless an external agreement is made between the artist and the buyer, the bundle of copyrights to an NFT still belong to the original artist. The NFT purchaser owns nothing more than a unique hash on the blockchain with a transactional record and a hyperlink to the file of the artwork.
Without legal parameters, fraud is inevitable
The issue of NFT copyright tracking gets even trickier when considering the potential for theft and fraud. In order to be added to the blockchain, NFTs must be “signed” by the uploader in a process known as “minting.” Similar to a painter’s signature on their painting, this feature is intended to link the NFT to its creator. Things can go wrong when minters lie about their identity, which is not uncommon across many NFT platforms.
The issue stems from the lack of a strong legal framework in the NFT market. One can mint a tweet, art piece or even a GIF of Nyan Cat without being the actual creator on some platforms. As a result, many artists have reported seeing their art being stolen and sold in NFT form without their consent, in what would clearly be a copyright violation in the traditional art marketplace.
This misconception goes further. The range of possibilities for what can be an NFT coincides surprisingly well with works eligible for copyright. While every jurisdiction defines “works” in different ways, none stray too far from the essentials. In Canada, for example, copyright protection extends to literary, artistic, dramatic or musical works in addition to performances, recordings and other related works. Creators need not apply for these protections — the state provides them inherently upon the creation of the work.
Naturally, this protection is guaranteed for the original work that an NFT represents. When artwork is created and auctioned on an NFT marketplace, the copyright functions almost exactly as it would in an in-person scenario, with the copyright retained by the artist. But a lack of copyright trading infrastructure that complies with international law makes the exchange of NFT copyrights impossible on current platforms.
So, unless an external agreement is made between the artist and the buyer, the bundle of copyrights to an NFT still belong to the original artist. The NFT purchaser owns nothing more than a unique hash on the blockchain with a transactional record and a hyperlink to the file of the artwork.
Without legal parameters, fraud is inevitable
The issue of NFT copyright tracking gets even trickier when considering the potential for theft and fraud. In order to be added to the blockchain, NFTs must be “signed” by the uploader in a process known as “minting.” Similar to a painter’s signature on their painting, this feature is intended to link the NFT to its creator. Things can go wrong when minters lie about their identity, which is not uncommon across many NFT platforms.
The issue stems from the lack of a strong legal framework in the NFT market. One can mint a tweet, art piece or even a GIF of Nyan Cat without being the actual creator on some platforms. As a result, many artists have reported seeing their art being stolen and sold in NFT form without their consent, in what would clearly be a copyright violation in the traditional art marketplace.
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